A rise over the course of the 2017-18 tax year saw funding for the Enterprise Investment Scheme (EIS) and Seed Enterprise Investment Scheme (SEIS) tax reliefs pass the £2.1 billion mark.
The EIS scheme saw the larger increase in approved funding, with an increase in funds raised of £28 million. In comparison, SEIS approved funding rose by approximately £2 million over the year, despite a fall in the number of companies receiving investment.
The EIS scheme allows investors to claim relief on Income Tax of 30 per cent on investments of £1 million or below in high-risk start-ups. Meanwhile, they can also invest as much as £2 million in “knowledge-intensive companies”.
The figures follow a crackdown on some lower-risk investments, which most recently saw a “risk-to-capital” test introduced in the Finance Act 2018.